Norwegian Cruise Line Holdings Ltd. Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurements and Derivatives (Tables)

9 Months Ended

Sep. 30, 2023

The derivatives measured at fair value and the respective location in the consolidated balance sheets include the following (in thousands):


		Assets				Liabilities
		September 30,		December 31,		September 30,		December 31,
	Balance Sheet Location	2023		2022		2023		2022
Derivative Contracts Designated as Hedging Instruments

Fuel contracts
	Prepaid expenses and other assets	$	41,928	$	53,224	$	6	$	7,137
	Other long-term assets		6,155		3,869		—		655
Foreign currency contracts
	Prepaid expenses and other assets		—		3,617		—		—
	Accrued expenses and other liabilities		1,083		4,386		57,591		177,746
Total derivatives designated as hedging instruments		$	49,166	$	65,096	$	57,597	$	185,538

Derivative Contracts Not Designated as Hedging Instruments

Fuel contracts
	Prepaid expenses and other assets	$	639	$	84	$	—	$	348
	Other long-term assets		—		—		—		191
Total derivatives not designated as hedging instruments		$	639	$	84	$	—	$	539
Total derivatives		$	49,805	$	65,180	$	57,597	$	186,077

The following table discloses the gross and net amounts recognized within assets and liabilities (in thousands):

The effects of cash flow hedge accounting on accumulated other comprehensive income (loss) were as follows (in thousands):


					Location of Gain
					(Loss) Reclassified
					from Accumulated	Amount of Gain (Loss) Reclassified
	Amount of Gain (Loss)				Other Comprehensive	from Accumulated Other
	Recognized in Other				Income (Loss) into	Comprehensive Income
Derivatives	Comprehensive Loss				Income (Expense)	(Loss) into Income (Expense)
	Three Months		Three Months			Three Months		Three Months
	Ended		Ended			Ended		Ended
	September 30, 2023		September 30, 2022			September 30, 2023		September 30, 2022
Fuel contracts	$	74,710	$	(48,593)	Fuel	$	9,540	$	33,886
Fuel contracts		—		—	Other income (expense), net		417		(293)
Foreign currency contracts		(16,825)		(146,950)	Depreciation and amortization		(3,394)		(1,831)
Total gain (loss) recognized in other comprehensive loss	$	57,885	$	(195,543)		$	6,563	$	31,762


					Location of Gain
					(Loss) Reclassified
					from Accumulated	Amount of Gain (Loss) Reclassified
	Amount of Gain (Loss)				Other Comprehensive	from Accumulated Other
	Recognized in Other				Income (Loss) into	Comprehensive Income
Derivatives	Comprehensive Loss				Income (Expense)	(Loss) into Income (Expense)
	Nine Months		Nine Months			Nine Months		Nine Months
	Ended		Ended			Ended		Ended
	September 30, 2023		September 30, 2022			September 30, 2023		September 30, 2022
Fuel contracts	$	33,640	$	96,139	Fuel	$	22,709	$	80,037
Fuel contracts		—		—	Other income (expense), net		74		(293)
Foreign currency contracts		1,193		(342,881)	Depreciation and amortization		(8,893)		(4,365)
Interest rate contracts		—		—	Interest expense, net		—		(40)
Total gain (loss) recognized in other comprehensive loss	$	34,833	$	(246,742)		$	13,890	$	75,339

The effects of cash flow hedge accounting on the consolidated statements of operations include the following (in thousands):


	Three Months Ended September 30, 2023						Three Months Ended September 30, 2022
			Depreciation						Depreciation
			and		Other Income				and		Interest		Other Income
	Fuel		Amortization		(Expense), net		Fuel		Amortization		Expense, net		(Expense), net
Total amounts of income and expense line items presented in the consolidated statements of operations in which the effects of cash flow hedges are recorded	$	170,893	$	204,608	$	12,060	$	186,984	$	186,551	$	152,330	$	31,461

Amount of gain (loss) reclassified from accumulated other comprehensive income (loss) into income (expense)
Fuel contracts		9,540		—		—		33,886		—		—		—
Foreign currency contracts		—		(3,394)		—		—		(1,831)		—		—

Amount of gain (loss) reclassified from accumulated other comprehensive income (loss) into income (expense) as a result that a forecasted transaction is no longer probable of occurring
Fuel contracts		—		—		417		—		—		—		(293)


	Nine Months Ended September 30, 2023						Nine Months Ended September 30, 2022
			Depreciation						Depreciation
			and		Other Income				and		Interest		Other Income
	Fuel		Amortization		(Expense), net		Fuel		Amortization		Expense, net		(Expense), net
Total amounts of income and expense line items presented in the consolidated statements of operations in which the effects of cash flow hedges are recorded	$	530,003	$	596,513	$	(4,938)	$	503,682	$	547,214	$	624,392	$	100,572

Amount of gain (loss) reclassified from accumulated other comprehensive income (loss) into income (expense)
Fuel contracts		22,709		—		—		80,037		—		—		—
Foreign currency contracts		—		(8,893)		—		—		(4,365)		—		—
Interest rate contracts		—		—		—		—		—		(40)		—

Amount of gain (loss) reclassified from accumulated other comprehensive income (loss) into income (expense) as a result that a forecasted transaction is no longer probable of occurring
Fuel contracts		—		—		74		—		—		—		(293)

The effects of derivatives not designated as hedging instruments on the consolidated statements of operations include the following (in thousands):


		Amount of Gain (Loss) Recognized in Income
		Three Months Ended				Nine Months Ended
		September 30,				September 30,
	Location of Gain (Loss)	2023		2022		2023		2022
Derivatives not designated as hedging instruments
Fuel contracts	Other income (expense), net	$	1,369	$	(733)	$	522	$	33,345
Foreign currency contracts	Other income (expense), net		(24)		(1,905)		(1,552)		(13,761)